Daniel W

Microcap Ideas: Photochannel Networks

"There is no reason to believe that Photochannel can outcompete [its competitors]."

...except for the fact that they've been outcompeting them and that their business model doesn't put them in direct competition with the retailers.

PhotoChannel's business model is the reason they've been able to outcompete the others and can be expected to continue to.

But it is also the reason it will post excellent gross margins--no money needs to be spent on marketing, as the above commentator noted, nor on the latest, up-to-date machines. What you see in the rear-view mirror is a lot different than what you will see out of the front window. Now and for many quarters to come.

At least that's my best guess. Though I can't wish you well in your short, as I'm long, I hope you do very well in other areas of the market, i.e., no hard feelings. If PhotoChannel does win the Wal-Mart contract, you may need those winnings to help you cover...